TIME and expertise have run out on whatever decisions the Central Bank of Nigeria wants to take on the eight banks it dislodged their boards from 14 August 2009. Tired of nearly two years of equivocation, CBN is threatening to revoke their licences if they do not meet a 20 December 2011 re-capitalisation deadline.

“We may be forced to withdraw our guarantee which is enabling the banks to borrow money at the inter-bank transaction and thereafter revoke their licences,” CBN’s Director of Banking Supervision, Sam Oni said.

According to him, the banks require N1.5 trillion to re-capitalise. He blamed shareholders for legal obstacles that stopped sale of the banks.

Has anyone given thought to the run on the banks this threat can cause? If the depositors are saved, what happens to thousands of jobs that CBN’s recalcitrance on this matter cause?

Weeks after forcefully possessing the banks, CBN staged a road show abroad, reported it had buyers, threatened the shareholders, and lambasted the House of Representatives for asking why it would spend N420 billion funds to rescue the banks.

Before 2009 ran out, another three banks had come under CBN’s daily and direct supervision.  How did CBN manage the eight banks since 2009? How did the N420 billion rescue package grow to N1.5 trillion?

Buyers are wary of banks under legal constrictors.  The most viable option remains returning the banks to their shareholders who had offered to re-capitalise them since 2009.  CBN would not consider the option. It believes shareholders do not exist, the same line Oni is towing though CBN knows it cannot do anything with the banks without the shareholders.

“Technically, most of these shareholders whose banks have negative capital no longer owe the banks. If they want to re-gain their banks back, they should raiseN1.5 trillion which is required to bring the bank to soundness and capital adequacy,” Oni said.

Why would CBN not allow shareholders re-capitalise the banks? What is its interest in the banks? Two of the ailing banks suffered a deposit loss of N186.26 billion in one year. For how long will CBN spend scarce public funds on these banks?

Last October in Washington, at the World Bank meetings, CBN Governor Sanusi Lamido Sanusi celebrated conviction of one of the sacked bank executives Mrs. Cecilia Ibru, former Managing Director of Oceanic Bank. A court jailed her for six months and ruled she would forfeit assets and cash worth N191 billion.

Sanusi celebrated the verdict thus, “Everybody we are trying of criminal charges will go to jail. You can put it as headlines. I have no doubts. Maybe, you do not want me to say it in the open because it could be subjudice. But I really have no doubts about that.” We can forget the exuberance, which the courts refused to punish.

Even if Sanusi secures conviction of all bank directors, will that re-capitalise the banks? Does he realise the state of the banks is a more urgent matter for the health of the economy and the common good than trial of bank chiefs?

CBN should approach the shareholders, they will easily raise the required N1.5 trillion and quickly close a chapter in our economic affairs that if left unattended can result in a worse bank failure than we witnessed in 1995.